1. A couple Belinda and Josh Smith each open up an individual First Home saver Account when the scheme opens on 1 October 2008.
Both of them earn an identical wage of $61,000 so they decide to put aside 10% of their individual salaries into their respective accounts. Each one then receives a 17% government contribution on the first $5,000 of their contributions made to their accounts each year.
After 5 years Belinda and Josh will together have saved a deposit of approximately $88,500 to use towards the purchase of their first home.
If they had instead decided to for go the government plan and get a term deposit with the same 7% earnings rate and the same yearly contributions their total deposit for the house after 5 years would be about $75,900.
This means that the First Home Saver account would have earned Belinda and Josh an extra $12,600 over 5 years because of the extra contributions of the Government.
2. In a second case study 19 year old Ria saved $1,000 per year for 4 years while attending university. She then started working and contributed $5,000 per annum for the next 6 years.
With the First Home Saver Account she would have accumulated a home deposit of $50,400 by the age of 29.
If you have a real estate need or question fee free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 0418 517 525 or call into our friendly office at Browns Plains or Waterford for further assistance.
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